From a quiet street in Menai to the sands of Bondi Beach, the largest alleged tax fraud syndicate in the country's history had somewhat humble beginnings. Adam Cranston, 30, son of Australian Taxation Office deputy commissioner Michael Cranston, was arrested on Wednesday with police alleging he set up and ran the $165 million tax fraud syndicate that involved six others. His family - siblings Joshua and Lauren and parents Robyn and Michael - have lived in modest homes in bushy nooks of the Sutherland Shire for most of their lives. But Mr Cranston quickly made his way into his father's world of tax accounting after graduating from Menai's local Catholic school Aquinas College. He studied commerce at the University of Western Sydney and soon moved to Sydney's eastern suburbs where he has mixed with a crowd of flashy entrepreneurs, real estate agents, race car drivers and lawyers. It was an introduction to Daniel Hausman, 47, that would allegedly set in motion the sophisticated fraud scheme that federal police blew wide open on Thursday. In 2010, Mr Hausman, a colourful Vaucluse property developer and former publican, set up a property development and financing business, Aventis Capital, with Mr Cranston and a close associate and real estate agent, Peter Larcombe, 37. Mr Cranston and Mr Hausman allegedly worked together to help companies struggling with liquidation. Mr Larcombe, whose death in August appears to be intertwined with the tax fraud revelations, spruiked his credentials in "business valuation and turnaround" and became so close with Mr Cranston that he was considered a friend by the whole Cranston family. Mr Cranston's mother, Robyn, said in an online profile that she worked for Aventis although there is no suggestion she is involved in fraud. Mr Cranston's friendships forged in Menai have remained strong and police allege he brought several old school mates into the fold of the extraordinary scam. A childhood friend, 29-year-old Chris Guillan, worked with Mr Cranston at insolvency firm Rodgers Reidy early in their careers and was brought on as Aventis' chief financial officer. Mr Guillan is now facing charges of helping the syndicate launder money by setting up a company to issue fake invoices and buy an eye-watering collection of Porches, motorbikes and other luxury cars. Another Aquinas old boy, Aaron Leo Paul, allegedly helped to recruit struggling drug addicts and petty criminals to act as phoney 'straw directors' for the syndicate's web of companies. In early 2016, Mr Cranston and Mr Hausman set up a private equity firm,&nbsp;Synep, with other individuals including accused syndicate member Jason Onley, 47, another Vaucluse businessman. Synep quickly bought out Plutus Payroll, the company are the centre of the alleged racket. However Mr Cranston's relationship with his close associate Mr Hausman&nbsp;had soured by early 2017 with the latter allegedly extorting the syndicate after a falling out. Police allege Mr Cranston spread the fruits of his labours far and wide. He established a motor sports team named after Synep and funded an expensive array of luxury racing cars. In October, he told a racing website he was importing a Porsche 911 from the UK for Synep Racing, the same Porsche model he owned for his everyday use. Mr Cranston and his brother, Joshua, were heavily involved in Synep Racing. He told the racing website that they grew up glued to the Bathurst 1000 and fulfilled a dream in February when they competed&nbsp;in the Liqui-Moly 12 Hour Endurance Race in Bathurst. Investigators have told Fairfax Media they not only seized several items that Mr Cranston bought for his wife, Elizabeth, but also his mistress. Both women had no knowledge of the alleged fraud. Adam's younger sister Lauren, 24, was allegedly brought into the fold and, along with her friend Devyn Hammond, were responsible for the day-to-day running of the syndicate. While father Michael had no knowledge of the fraud, he allegedly looked up restricted information on garnishee orders and audits as the net closed in on his son. He will face court in June on charges of abusing his position as a public official. This story first appeared in The Sydney Morning Herald

Australia's largest tax fraud syndicate had its origins in modest Menai

From a quiet street in Menai to the sands of Bondi Beach, the largest alleged tax fraud syndicate in the country's history had somewhat humble beginnings.

Adam Cranston leaves Sydney Police centre after being released on bail on Thursday. Photo: Daniel Munoz

Adam Cranston, 30, son of Australian Taxation Office deputy commissioner Michael Cranston, was arrested on Wednesday with police alleging he set up and ran the $165 million tax fraud syndicate that involved six others.

His family - siblings Joshua and Lauren and parents Robyn and Michael - have lived in modest homes in bushy nooks of the Sutherland Shire for most of their lives.

But Mr Cranston quickly made his way into his father's world of tax accounting after graduating from Menai's local Catholic school Aquinas College.

He studied commerce at the University of Western Sydney and soon moved to Sydney's eastern suburbs where he has mixed with a crowd of flashy entrepreneurs, real estate agents, race car drivers and lawyers.

It was an introduction to Daniel Hausman, 47, that would allegedly set in motion the sophisticated fraud scheme that federal police blew wide open on Thursday.

In 2010, Mr Hausman, a colourful Vaucluse property developer and former publican, set up a property development and financing business, Aventis Capital, with Mr Cranston and a close associate and real estate agent, Peter Larcombe, 37.

Mr Cranston and Mr Hausman allegedly worked together to help companies struggling with liquidation.

ATO deputy commissioner Michael Cranston near the Central Local Court in Sydney on Thursday. Photo: AAP

Mr Larcombe, whose death in August appears to be intertwined with the tax fraud revelations, spruiked his credentials in "business valuation and turnaround" and became so close with Mr Cranston that he was considered a friend by the whole Cranston family.

Mr Cranston's mother, Robyn, said in an online profile that she worked for Aventis although there is no suggestion she is involved in fraud.

Mr Cranston's friendships forged in Menai have remained strong and police allege he brought several old school mates into the fold of the extraordinary scam.

A childhood friend, 29-year-old Chris Guillan, worked with Mr Cranston at insolvency firm Rodgers Reidy early in their careers and was brought on as Aventis' chief financial officer.

Brothers Joshua and Adam Cranston were heavily involved in Synep Racing, named after the company Adam allegedly set up for tax fraud. There is no suggestion Joshua is involved. Photo: Supplied

Mr Guillan is now facing charges of helping the syndicate launder money by setting up a company to issue fake invoices and buy an eye-watering collection of Porches, motorbikes and other luxury cars.

Another Aquinas old boy, Aaron Leo Paul, allegedly helped to recruit struggling drug addicts and petty criminals to act as phoney 'straw directors' for the syndicate's web of companies.

In early 2016, Mr Cranston and Mr Hausman set up a private equity firm, Synep, with other individuals including accused syndicate member Jason Onley, 47, another Vaucluse businessman.

Synep quickly bought out Plutus Payroll, the company are the centre of the alleged racket. However Mr Cranston's relationship with his close associate Mr Hausman had soured by early 2017 with the latter allegedly extorting the syndicate after a falling out.

Police allege Mr Cranston spread the fruits of his labours far and wide. He established a motor sports team named after Synep and funded an expensive array of luxury racing cars.

In October, he told a racing website he was importing a Porsche 911 from the UK for Synep Racing, the same Porsche model he owned for his everyday use.